CHAPTER IV
* INSURANCE BRANCH AGAINST OLD AGE,
NON-EMPLOYMENT DISABILITY AND DEATH
PART
1
Financing
Article 33
The
insurance branch against old age, disability and death shall be
financed by the following :-
- the share which the employer is responsible for the payment
thereof in respect of insurance contributions amount to **11%
of the wages of the insured who works for him;
- the share which the insured is responsible for and which shall
be borne by him in the amount of 7%** of his monthly wage;
- the indemnity due to each insured person, in accordance with
the Labour Law and pursuant to Article 15 (2);
- the additional amounts stipulated in Article 29 of this Law
and also the interests stipulated in Article 31 thereof;
- contributions for penszions and profits thereof which are transferred,
when due, from the Government Pension and Retirement Fund to the
General Organisation;
- the loans which shall be appropriated in the state's general
budget on the recommendation of the Minister for Labour and Social
Affairs after agreement with the Minister for Finance and National
Economy;
- profits derived from the investment of the funds of the social
insurance;
- donations and bequests made to the General Organisation for
this branch of social insurance;
- other income which is allocated to this social insurance.
*
This branch of Social Insurance against old age, non-employment disability
and death is temporarily suspended by Decree-Law No. 12/1977 in so
far as non-locals are concerned with effect from 1st May 1977 until
further decisions of the Council of Ministers are issued re-applying
it to expatriates. This Decree Law was published in the Official Gazette
No. 1277 of 12th May 1977.
** The employer and the insured contributions were reduced from 11%
to 7% and from 7% to 5% respectively by Decree-Law No. 20/1986 with
effect from 1st September 1986. The Decree-Law was published in the
Official Gazette No. 1709 dated 28 August 1986.
PART
2
Eligibility for Old Age Pensions
Article 34
The
insured shall be entitled to an old age pension, dependent upon
the contributory period of social insurance, whether such period
be continuous or interrupted, from the General Organisation in the
following instances :
- termination of employment of the insured (male) before he attains
the age of 60 years provided that his period of contribution is
at least 240 insurance months, or the insured (female) before
she attains the age of 55 years and provided that her period of
contribution is at least 180 insurance months.
The pension
due shall be reduced in this case by a percentage in accordance
with Schedule I, dependent upon the age of the insured at the
time of the request for payment of the pension. The payment of
the pension from the General Organisation shall become due, in
this instance, with effect from the date of the beginning of the
period in the said Schedule on the basis of which the percentage
reduction shall be determined or on the day following the date
of termination of employment, whichever is first.
The reduction by percentages as stated in the second paragraph
of this Article shall not be valid in the event of requests for
payment of pensions by the insured or his heirs for proven disability
or the occurrence of death;
- *Termination
of employment of the insured (male) when he attains the age of
60 years and his period of contribution is at least 180 insurance
months or insured (female) when she attains the age of 55 years
and her period of contribution is at least 120 insurance months
in the insurance;
- * Termination of employment of the insured (male) after the
age of 60 years or the insured (female) after the age of 55 years
and when the contributory period is at least 120 insurance months
in the social insurance of which at least 36 insurance months
contribution shall have been consecutive during the last five
years preceding termination of employment.
The period during
which the insured receives daily allowances in case of his temporary
disability from work for reason of employment injury, shall be included
in the contributory period in social insurance in respect of three
preceding paragraphs, and no contributions to the social insurance
are made for these periods.
Article
35
The
insured who was participating in the private schemes referred to
in Article 93 and 94 of this Law has the right, upon his written
request to the General Organisation to include in the period assessed
for the determination of the pension for old age, disability and
death, periods equal to that which his equity in the private schemes
shall permit in accordance with Schedule 4 annexed hereto and these
periods shall be treated on the same basis as those upon which the
pension of the insured is calculated.
The
insured shall also have the right to include in the period assessed
for the determination of the pension for old age, disability and
death a period equal to what will permit the amount of leaving indemnity
paid on his behalf for service prior to this social insurance in
accordance with Article 39.
*
A hypothetical contribution period of sixty insurance months shall
be added upon calculation of the retirement pension in case the
insured, he or she, completes or exceeds the contribution period
referred to in each of Clauses 2 and 3 of this Article (34) of the
Social Insurance Law, whether all such period is an actual contribution
period or includes a period or periods deemed legally as an insurance
contribution period with regard to the insured who already retired
or retires up to the end of five-years period from the effective
date of Law No. 15/1987.**
The Council of Ministers may, upon the submission of the Minister
for Labour and Social Affairs and approval of the Board of Directors
of the General Organisation for Social Insurance, issue an Edict
for extending the period referred to in the foregoing paragraph.
**
The Law referred to was enacted under No. 15/1987 and was published
in the Official Gazette No. 1773 dated 19 Nov. 1987 and the 5-years
period will end by 30 Nov. 1992; and then the validity of adding
the period of the 5-years is to be extended in virtue of Article
1 of Decree-Law No. 15/1987 to another similar period with effect
from Dec. 1st, 1992 by Prime Ministerial Edict No. 6 issued on 16th
March 1993.*** And as from the effective date of this Edict, retirement
pensions payable by the General Organisation for Social Insurance
shall be amended accordingly.
The General Organisation shall be bound to pay the retirement pensions
amended accordingly and to pay the retirement pensions due after
the enforcement of this Edict and any payment received by an insured
in violation of Article 136 prior to the amendment thereof, in the
manner set forth shall be waived.
***
The validity of granting the five years hypothetical contributory
period was extended permanently as of 1 December 1997 subject to
the terms and conditions prescribed by the Prime Ministerial Edict
No. 17 for 1998 published in the Official Gazette No. 2333 on 12th
August 1998.
The
period included shall be determined in accordance with the age of
the insured, his wage at the time of the implementation of the Law
in his respect and the amount paid for his account to the General
Organisation in accordance with Schedule 4 attached.
Where
the insured wishes to receive, upon the termination of his service,
his entitlements due to him in the private schemes referred to in
Articles 93 and 94 of this Law, he shall so receive cash and no
previous contributory period shall be included in the contributory
period for old age, invalidity and death insurance prior to that
of the application of the Law in his respect.
Article
36
The
insured may request an extension to the period of contribution in
social insurance by payment of an additional amount, calculated
in accordance with Schedule 4 attached, to the General Organisation
and the amount shall be determined either on the basis of the wage
at the time of commencement of participating in the social insurance
or the date of presentation of the request, if later, and the said
amount shall be paid either in one payment or monthly instalments
in accordance with Schedule 5 attached hereto.
PART
3
Eligibility for Pensions for Disability and
Death Resulting from a Non-Employment Cause
Article
37
Where
the employment of the insured is terminated by reason of disability
or death not due to an employment cause and prior to the insured
(male) attaining the age of 60 years or prior to the insured (female)
attaining 55 years, a pension shall be due to the insured or the
heirs subject to the following conditions :-
a. if the period of contribution in social insurance totals at
least six consecutive months immediately prior to the occurrence
of disability or of death; or
b. if the period of contribution in social insurance totals at
least 12 interrupted months of which there were at least three
consecutive months contribution in the social insurance immediately
prior to the occurrence of disability or death.
If
no disability or death occurs after having met the minimum periods
of contribution referred to in the above mentioned paragraphs (a)
and (b) and the insured (male) has not attained in the age of 60
years or the insured (female) has not attained the age of 55 years
and contribution to social insurance cease for any reason, either
of the said insured or the heirs, as the case may be, shall be of
such cessation being covered by social insurance and prior to the
insured (male) attaining the age of 60 years or the insured (female)
attaining the age of 55 years or if death occurs within one year
from the date of cessation of contributions in social insurance
irrespective of age, provided that the insured may not have met
the conditions for entitlement to the pension prescribed in the
aforementioned Article 34(1) and that this pension was more advantageous.
The
Minister for Health, in agreement with the Minister for Labour and
Social Affairs, shall regulate by an Order, on presentation thereto
by the Board of Directors, the method by which disability and death
may be proven.
PART
4
Eligibility for Lump Sum Compensation
Article 38
Were
the employment of the insured is terminated and he does not qualify
under the conditions for eligibility for a pension, he shall be
entitled to a lump sum compensation, and this compensation shall
be paid in the following instances :-
- the insured (male) has attained the age of 60 or more years;
- the insured (female) has attained the age of 55 or more years;
- if the insured (female) was married, divorced or widowed on
the date of lodging a claim for payment;
- * emigration of the insured; male or female;
- * departure of an insured person from the country finally or
if he has taken up employment abroad on a permanent basis or has
joined a diplomatic mission in the embassy or consulate of his
State;
- the final judgement for imprisonment of the insured for a period
of ten years or more; or the period remaining for the insured
(male) to attain the age of 60 years or the insured (female) to
attain the age of 55 years whichever is shorter;
* As modified by Decree-law
No. 27/1976 published in the Official Gazette No. 1190 dated 26th
August 1976.
- total disability;
- death;
The lump sum
compensation shall be paid in case of death to:-
(a) |
widow
or widows of the deceased; |
(b) |
should
there be no widow or widows, then to the children of the deceased
and the children of his deceased son; |
(c) |
should
there be no widow and children, then to the father and mother;
and |
(d) |
should
there be no person in the above mentioned categories then to
brothers and sisters of the deceased. |
The
aforementioned persons shall be entitled to receive the compensation
if they meet the required conditions for eligibility of pensions
as provided for in Chapter 6 of this Law and if two or more persons
in the same category are entitled jointly, the amount shall be distributed
between them equally.
If
there are no heirs as detailed in the preceding sub-sections (a),
(b), (c), and (d), the amounts shall devolve to the Social Insurance
Fund against old age, disability and death.
PART
5
Computation of Pensions for Old-Age and Non-employment
Disability and Death and Computation of Lump Sum Compensation
Article
39*
Without
prejudice to the provisions of Article 34(1), the insured (male)
upon attainment of the age of 60 or more years or the insured (female)
on the attainment of the age of 55 or more years shall be entitled
to an old age pension derived by multiplying one fiftieth of the
average monthly wage due to the insured on the basis of which the
social insurance contributions were paid during the last two years
of the period of contributions to the social insurance, or one sixtieth
of the average monthly wage during the last contributory period,
in the event that such contributory period is less than two years,
multiplied by the number of completed years of contribution to the
social insurance.
*
The ratio was modified to one fiftieth by Prime Ministerial Edict
No. 11/1989 published in the Official Gazette No. 1851 of 18/5/1989.
Article
40
In
the calculation of the average monthly wage referred to in the previous
Article the difference between the wage of the insured at the end
of the last three years of his service or his actual service if
less and his wage at the beginning thereof shall not exceed 40%
but if the difference exceeds this limit then the excess shall not
be considered in the calculation of the average wage on the basis
of which the pension is to be calculated.
Article
41
The
pension, in the case of disability or death, shall be paid on the
basis of the percentage stated in Article 39 of the average monthly
wages used for payment of the social insurance contributions during
the last year or the period of contribution if less than this and
a national period of three years shall be added to the period of
contribution, provided it does not extend beyond the attainment
by the insured of the age specified in Article 34(2).
The
pension shall in no case be less than 40% of the average monthly
wages referred to in the first paragraph of this Article.
Article
42
The
insured or his heirs may request a division of the period of contribution
to the social insurance, at the time of the determination of the
pension or of the lump sum compensation, into separate periods provided
disparity existed in the wages on the basis of which contributions
to the social insurance were made.
As
a condition for benefiting from the preceding provision, the requested
period for separate computation shall not be less than three years
and provided that the percentage variance in the wages at the end
of each period exceeds 15% of the wage subject to the contribution
at the end of the previous period.
The
insured or the heirs may not request a division of the contributory
period in social insurance into more than three periods.
The
pension or lump sum compensation shall be computed for each period
thereof, as referred to in the second paragraph of this Article,
separately on the basis of the average monthly wage as prescribed
in the preceding Article 39 or Article 41 para 1; or on the basis
of the annual wage referred to in the last paragraph of Article
43, as the case may be.
The
final determination of the compensation or the pension shall be
the sum total of compensation or pension due in respect of the total
period subject to the limitation on the maximum pension prescribed
in this Law.
Article
43
The
lump sum compensation referred to in Article 38 of the Law shall
be computed on the basis of 15% of the annual wage of the insured
multiplied by the number of completed contributory years in the
social insurance and added thereto simple interest of not less than
3% thereof from the date of cessation of social insurance until
the date of payment.
By
"annual wage" is meant the average monthly wage subject
to the contribution during the final two years of the contributory
period in the social insurance multiplied by twelve or the average
monthly wage in the contributory period if less than that and multiplied
by the same figure.
PART
6
Voluntary
Insurance against Old Age,
Disability and Death
Article
44
Every
worker who contributes compulsorily to the social insurance against
old age, disability and death for at least five years and who no
longer possesses the conditions for coverage under this Law for
any reason, is entitled to continue voluntarily in this social insurance
provided that he so applies within six months following the date
of non-coverage to this social insurance and undertakes thereby
to pay the full insurance contributions due in respect of himself
and the employer to the General Organisation.
The
Minister for Labour and Social Affairs shall make an *Order, on
the recommendation of the Board of Directors, determining the method
of implementation of this Article.
PART
7
General
Provisions for the Insurance against
Old Age, Disability and Death
Article
45
In
the calculation of the period of contribution to the social insurance,
a fraction of a month shall be rounded to a full month in each period;
and a fraction of a year in the totals of these periods shall be
rounded up to a full year if as a result thereof the insured becomes
eligible for a pension.
ยท The Ministerial Order has been issued under No. 8/1988 and published
in the Official Gazette No. 1819 dated 6 October 1988, the text
published in the part of Ministerial Orders.
Article
46
In
the event of the transfer or appointment of a person of either sex
engaged in the Government sector and covered by the law providing
pensions and retirement rewards for the Government employees, to
the private, co-operative or para-statal sectors and becoming subject
to the Social Insurance Law, or vice versa, both the General Organisation
of the Retirement Fund and the General Organisation for Social Insurance
undertake to exchange the total of contributions which have been
deducted from his salary and the Government's share which has been
paid to his account or the total of the share of the worker in the
contributions to the social insurance against old age, disability
and death and the share of the employer which has been paid for
the account of the insured and added to either total an annual interest
of 5% from the date he is subjected to the law under which he was
formerly covered until the transfer of the totals to the General
Organisation under whose Law he shall be subject. In both instances
the provisions of the Law of the Fund to which the total has been
transferred and shall apply together with the previous and the subsequent
periods and the Council of Ministers shall make an Order for the
regulation thereof.
If
the transferred or appointed person had already accrued the maximum
pension stipulated in the law under which he was formerly covered
at the time of such transfer or appointment, then no contributions
are transferred and he shall be entitled to a lump sum compensation
for the new period whenever he completes the qualifying period.
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